Getting Invoices Paid - Assistance Please!

[Easy Workplace Safety]

Hi

I run a small OHS Consulting business with some national clients. I currently have a problem with one of my clients not paying their account.

My Process: I send a proposal to my clients with details of the service, the costs and the payment terms (7 days). I require a deposit before I commence work. All was going very well and I met with him in person to review the plan. There was no problem, a deposit was paid and the project was started.

As he was just starting his business (I might point out at this stage that he is in the medical profession), I agreed to a monthly repayment plan. I sent him 2 lots of OHS Documents at regular intervals. He paid quickly on the first 2 invoices however he has gone to ground in the last 5 weeks. I sent another invoice 2 weeks ago and have had no communication from him in any form since late May.

I know he is still around as he now has a website up and running and despite my pleasant phone calls and follow up emails, he is not communicating with me. He owes quite a substantial amount of money and I am not sure what to do next.

I operate an honest business and feedback from my clients is excellent. This is causing me sleepless nights and my stress levels are growing daily.

Can anyone assist me?

[whateverbusinesssolution]

Hi Donna,
Sorry to hear about the situation...

Is he amenable to meeting with you to discuss precisely why he is not paying? Is it a cashflow problem that could be solved by a payment plan?

I've often found that communication is the key to resolving these issues.

Alternatively, it may be that you will need to start legal proceedings for recovery of the debt. Your legal options will vary according to the amount of the debt and the type of entity. May be time to consult your lawyer.

You may also wish to review your trading terms & conditions to see if they can be improved to incorporate things like Retention of Title (if applicable) or charging clauses (again if applicable) to avoid a recurrence.

[DebtCollector]

Hi Donna,

I always say if the debt is over 60 days old it's time to take affirmative action.

We are a debt collection company. If you need any advise contact me on the email/numbers below.

[LeelaCosgrove]

Time to get tricky!

Step 1: call from a phone you don't normally call him from. DO NOT call from a private number, because he'll just avoid and if you call from one he knows is you, then he'll also avoid.

Step 2: don't ask for the money. Instead, find out what's going on. Tell him you understand that he is a man of his word and that he would have paid you if he had been able to. Tell him you are cool to delay payments and work stuff out - you just want him to communicate with you and let you know what's going on. Be flexible, but most importantly - give him a way to back down while still SAVING FACE.

What happens in these situations is simple. People's cashflow sucks and they are embarrassed. He wants to appear like he's doing well, not like he's suffering and he's afraid to admit that he's hurting. Give him the chance to work it out AND To save face and you are more likely to get a satisfactory outcome.

Step 3: Follow up with him regularly in the same way. Check how things are going. Ask if it's okay for you to send through the next invoice. Ask if he needs help, if there is stuff you can do.

This is how you win long-term business and raving fans.

[Easy Workplace Safety]

Great advice. Thank you so much.

You are so right in saying that communication is the key and I think that is what is so frustrating.

I have been careful in my calls to him as they have all been focussed on my concern about his receipt of the confidential documents and to ensure he is OK. I have asked him a couple of times if he could indicate when he is likely to make the payment however still no reply.

As he is opening a new clinic, I am sure he has an enormous amount of debt hanging over his head so cashflow may be the issue. It is getting him to talk to me which seems to be the problem for him. I am very easy going so from my point of view I cannot see the problem.

I will give him a ring from my husbands phone or better still, I will get my husband to give him a call.

The suggestion of reviewing my terms and conditions is also a good one so thank you as I will certainly follow this up.

Thank you for the great suggestions.

[Jexley]

Geez, all the stuff I'd had ready to say was covered by Leela, so I'll just reiterate that you need to get a hold of this guy and give HIM the power by saying that you understand whatever circumstances he may be going through, but that it is imperative that he attempt to work something out or you're going to kneecap him.

Okay, maybe not threats of physical consequences, but it could be implied... heh.

Good luck, and let us know when it's sorted.

[Easy Workplace Safety]

Thank you for the support.

I have taken all the advice offered and the saga continues. Have left further messages today on a different number along with a friendly email.

Will see how this goes and if no communication in next few days will have to take further action.

Will keep you posted.

[LeelaCosgrove]

ROFL ...

I almost wrote:

Step 4: If you don't get your money, send some guys around to kneecap him ... but I didn't want to be accused of inciting violence ...

[Easy Workplace Safety]

I have a few options available to me - maybe this is one I could add! LOL

All very frustrating when I am being so nice to him and giving him the benefit of the doubt - nearly time to bring out the top guns and get some action happening.

[RMDesign]

Sorry to hear this is causing you so much stress!
I don't really have any tips for this scenario.. but wonder if the business practises of one of my suppliers might help for the future?

They offer "discounts" if invoices are paid within the set period.
I'm sure this is built into the price though - so essentially acts as a surcharge for late payment.

They then contact you with a friendly reminder the week before the invoice is due to remind you of the "saving" - it gives them a good excuse to put their foot in the door and make contact with their "good guy face" on as they are saving you money. :)